The Money Angle

the bias of hedging on implied delta

Tweets Before we get to today’s meat, here are 2 threads spurred by oil’s advance yesterday.   Delta is God…

2 days ago

how to get arbed with perfect information

The “Bridge of Asses” 📺Option Pricing Explained: No Arbitrage + Financial Mathematics from a Quant | 52 min watch Doug Costa (SIG…

2 days ago

N² – n: why shorting is mathematically cursed

Recall the levered silver flows post where we see the quick math of levered ETFs. For a fund to maintain its mandated…

1 week ago

not all averages are created equal

What did we notice? a * b = Mean² − MAD² (where MAD = mean absolute deviation) As soon as…

2 weeks ago

From Text ➡️ Dashboards

We’ll start with some useful resources for the learners, then move to material for traders ready to do stuff. CME…

2 weeks ago

vega’s finishing move

“Vega wounds, gamma kills” is an esoteric expression that’s still common enough that you can google it and return a…

2 weeks ago

trading as a sudoku puzzle with prices as the given numbers

Trailing 1-year inflation per the CPI index has been ~2.5% Prompt CME gasoline futures (RBOB) are up 80% this year…

3 weeks ago

a market-making project you can do today

Friends, I tweeted something the other day that I want to expand on because it’s one of those ideas that’s…

4 weeks ago

approximating gamma in your head

By now y’all know option traders have the ATM straddle approximation burned into their retina: straddle ≈ .8 Sσ √T…

1 month ago

oil options and the raw gamma paradox

The single biggest adjustment to get my head around when I crossed the chasm from equity options trading to commodity…

1 month ago